Canada: Still a Resource Superpower

By David Lindsay, President and CEO, Forest Products Association of Canada

As each day passes, our nation tries to come to grips with the economic and political impact of the rapid decline in oil prices, resulting in lower investment, layoffs and deteriorating tax revenues.
Less attention has been paid to the Canadian mining sector, but it also is facing lower prices and anemic demand from the struggling global marketplace.

The ebb and flow of resources is not new. Economic historian, Harold Innis, once said Canada developed as a “staples economy” that relied on the likes of fur, cod, and coal. Despite the fact that those resources have had their day, one of the foundational resource sectors fundamental to the development of Canada —our vast forests—is again creating jobs and prosperity for our nation. Canada’s forest products industry is picking up ― exports are on the upswing, prices for lumber are good and the sector is hiring.

The forest products industry knows what it’s like to smack into a wall ―it went through a difficult decade shedding mills and employees to the point where many onlookers were ready to write it off as a sunset sector. But during this time of crisis, necessity became the mother of invention and the industry has transformed and innovated.

Instead of just being “hewers of wood”, the forest sector has become a major manufacturing industry that accounts for 12% of Canada’s manufacturing GDP — that’s more than Canada’s auto sector. Pulp and paper mills are turning into veritable bio-refineries producing bio-chemicals and bio-energy with many facilities selling green energy to the grid. Wood fibre is now being used in everything from car parts, to cosmetics and clothing. The future of the forest products industry will focus on the likes of nano-technology and 3-D printing. And while the future is built on the foundation of the past, the sector has become modern, sophisticated and high tech, an emerging leader in the “new” economy.

Products made from wood fibre can also be considered “green”, replacing those made from materials with a much higher carbon-footprint. Forests are renewable – all harvested trees are regrown and will be there for future generations. And a 2014 Leger Marketing survey of international customers found that Canada’s forest products industry had the best environmental reputation in the world.

And so the future for forestry looks promising. Exports were up almost 10% last year and forest products are now Canada’s number one export to China. Forest companies also expect to benefit from the lower Canadian dollar and increase their sales this year.

That’s why the forest industry now offers stable employment. For many forest companies, the most pressing problem is getting enough people to check the classifieds, or the job website, “thegreenestworkforce.ca” for the rewarding jobs on offer The sector is already one of the biggest employers in Canada —going back to the auto sector example, forestry has about 55,000 more employees than auto manufacturers. And under the sector’s Vision2020, the industry is aiming to recruit an additional 60,000 employees by the end of the decade.

Today in Canada our lumberjacks often wear lab coats and are more likely to carry smart devices than axes. So for those questioning their future in Canada’s resource sector, take a look our way, and don’t forget to see the forest for the trees.